Stretching the IT Dollar with Virtualization - June 2007

What is virtualization and how does it affect the bottom line? For nearly 10 years, VMware of Palo Alto, California, has made a name for itself by making computing more efficient with virtualization technology. Sun recently spoke with Raghu Raghuram, vice president of product and solutions marketing at VMware, to find out about the business benefits of virtualization.

Q: What is virtualization?

A: Virtualization is a layer of software that partitions — or carves up — the resources of a server so that multiple operating systems can simultaneously, yet safely, access them. This creates what we call virtual machines — software that acts like physical servers. Virtualization allows fewer servers to run more applications and operating systems.

The technology can also be used to aggregate resources across servers, which creates a pool of computational resources that keep chugging away regardless of demand. If a virtual machine fails, business applications can be shifted over to another virtualized environment without affecting operations.

Q: How does this cut IT operating costs?

A: Virtualization can substantially reduce hardware purchasing costs — and enterprises don't have to worry about where they'll house ever-increasing amounts of hardware. Plus, the management of applications and operating systems becomes more cost-effective because business-critical applications are no longer spread out among multiple servers.

Q: Does virtualization also reduce power consumption?

A: Many utilities think so, and offer rebates and incentives for companies with virtualization programs. According to our research, the average power and cooling costs of a server are reduced by $560 annually by using virtualization technology. Here's why: the average application typically uses only 10 to 15 percent of a server's energy, yet the server still requires as much power and cooling to run a few applications as it does to run many applications. So if a server that usually runs at 10 percent utilization can be made to run at 50 percent utilization, the result can be a five-fold gain in power efficiency.

Q: How else does virtualization impact the bottom line?

A: Virtualization goes a long way to meet changing market conditions faster — and we're seeing more of these benefits as the technology matures. For example, buying, testing, and implementing more servers used to be the way companies would meet increased customer demand. But with virtualization, an organization can draw upon the computing power of its existing servers to respond to demand in a matter of days or even minutes, instead of the weeks and months previously required to catch up to new market challenges.

Q: Is virtualization confined to servers, or can it be used for desktop computers, too?

A: Virtualization can certainly be used for the desktop, particularly to improve manageability and security. For example, desktop systems used by contractors and remote employees are not always easy to manage or secure, but with virtualization, IT managers can partition areas on these machines so applications can only communicate over authorized network connections.

Q: Does company size matter when employing virtualization?

A: Not really. We have customers with 50 or fewer employees that use virtualization, as well as very large corporations on the Fortune 100 list. The degree to which the technology is used varies, and sometimes depends on how many servers the company owns — or how aggressively an organization wants to virtualize its hardware.

Q: What are the technological limits of virtualization?

A: Right now the limits of virtualization revolve around how much server computing power an application needs. Only a few business applications — perhaps 10 percent of the market — require dedicated hosting by a single server. But for the remaining 90 percent of business-critical applications, virtualization works very well.

Q: How has the virtualization industry changed over the last five years?

A: Most people don't know this, but virtualization — at least for mainframe computers — has been around since the 1960s. Yet it was only in the late 1990s, when we began to virtualize standard x86 servers, that the benefits of the technology could be spread across the enterprise. Now virtualization has become a critical element in product road maps throughout the high-tech industry. Processor vendors are now changing their architectures to allow more virtualization capabilities, and hardware companies are shipping servers with configurations dedicated to maximizing virtualization.

Q: What is on the horizon for virtualization?

A: Business continuity looks like the next big thing for virtualization. Most companies that use UNIX-based machines, such as Sun SPARC servers, typically have invested in business continuity capabilities that protect IT investments from disasters. But with many Intel-based servers, the complexity of the environment makes it difficult to implement these initiatives.

With virtualization, however, installing business continuity measures across applications and operating systems becomes nondisruptive and affordable. It's all part of how virtualization makes computing more efficient, which ultimately saves money while making the enterprise more nimble.

About Raghu Raghuram
Raghu Raghuram is vice president, product and solutions marketing at VMware, Inc., where he leads worldwide product marketing, solution marketing and business planning for the company's infrastructure business. Prior to joining VMware in 2003, Raghuram held product management and marketing roles at Netscape, AOL, and Bang Networks.